Toyota Auto Receivables 2022-D Owner Trust Annual Report - How They Did This Year

I’m writing this guide to help you understand how your investment performed this year. Instead of digging through dense legal filings, we’ll break down what is actually happening with your money.

1. What does this trust do and how did it perform?

This isn't a typical company that sells products. It is a financial "bucket" created on October 19, 2022. It holds $1.35 billion in auto loans from Toyota Motor Credit Corporation (TMCC). You bought pieces of this bucket—Class A-1 through A-4 notes—to receive a share of the monthly payments from people who financed their Toyotas. This year, the trust continued its primary job: collecting those payments and passing them to investors.

2. Financial performance

Because this is a fixed pool of loans, it doesn't "grow" like a tech company; it shrinks as loans are paid off. We measure performance by the "pool factor," which shows the remaining balance compared to the original $1.35 billion. The trust is working exactly as planned. The borrowers are high-quality, with an average credit score of 775 at the start. No single borrower accounts for more than 0.01% of the pool, which keeps your investment well-diversified.

3. Major wins and challenges

The biggest win this year is stability. Both the servicer (TMCC) and the trustee (U.S. Bank Trust Co.) passed their annual audits. There were no issues with how they managed the $1.35 billion in assets. The trust also kept its $3.375 million reserve account fully funded to cover any missed payments.

4. Financial health

The trust is in good shape. It doesn't rely on outside credit or complex bets to stay afloat. It relies entirely on cash from car payments. Several layers of protection—including other note classes, the reserve account, and extra collateral—provide a strong buffer against losses. These protections remain at their target levels.

5. Key risks

While the trust is stable, watch for two things:

• Trustee Legal Issues: The companies acting as trustees are involved in unrelated lawsuits regarding other investments. While they claim this won't impact this trust, it is worth monitoring their reputation and stability.
• Economic Sensitivity: If the economy struggles and people lose their jobs, they may stop paying their car loans. While current losses are very low (well below 1%), a spike in unemployment could lead to more repossessions. This would drain the reserve account and eventually lower your returns.

6. Competitive positioning

This is a straightforward, "plain-vanilla" investment. It doesn't try to be fancy; it just collects car payments. This is generally lower risk than complex products like collateralized debt obligations. Because it is backed by prime Toyota borrowers, it maintains high investment-grade ratings from agencies like Moody’s and S&P.

7. Future outlook

The trust is performing as expected. As the pool shrinks, it will eventually reach a "clean-up call." This happens when the remaining balance falls below 10% of the original $1.35 billion. At that point, Toyota can buy the remaining loans and close the trust.

8. Market trends and regulatory compliance

The trust remains compliant with all standard disclosure rules, ensuring you receive consistent, clear data on how the loans are performing.

Investor Takeaway: This trust is designed for those looking for predictable, steady cash flow backed by high-quality auto loans. Because it is a "shrinking" asset, it is best viewed as a way to earn interest over time rather than a vehicle for capital appreciation. As long as the underlying borrowers continue to make their payments, the trust is functioning exactly as intended.